Headline of release should read: UniFirst Announces... (sted UnifFirst Announces...).

The corrected release reads:

UNIFIRST ANNOUNCES FINANCIAL RESULTS FOR THE FIRST QUARTER OF FISCAL 2012

UniFirst Corporation (NYSE: UNF) today announced results for its first quarter of fiscal 2012, which ended on November 26, 2011. Revenues were $313.0 million, up 14.6% from $273.1 million for the first quarter a year ago. Net income was $25.8 million ($1.30 per diluted common share), compared to the first quarter of fiscal 2011 when net income was $23.8 million ($1.20 per diluted common share).

Ronald D. Croatti, UniFirst President and Chief Executive Officer said, "We are very pleased with the strong revenue growth in our core laundry operations during the quarter which was the result of the continued outstanding performance of our sales and service organizations. The excellent results of our Specialty Garments and First Aid segments also contributed to the quarter's top and bottom line growth."

Core laundry revenues for the quarter were $272.3 million, up 14.1% from those reported in the same period in fiscal 2011. Excluding the positive effects of acquisitions and a stronger Canadian dollar, core laundry revenues increased 12.1%. Income from operations for this segment grew 1.7% compared to the first quarter of fiscal 2011, but fell as a percentage of revenues to 12.8% from 14.4% a year ago. As anticipated, the operating margin decline in the core laundry operations was due primarily to increased merchandise amortization as a percentage of revenues. The impact of the merchandise was partially offset by lower payroll and payroll related costs as well as depreciation expense as a percentage of revenues.

Revenues for the Specialty Garments segment, which consists of nuclear decontamination and cleanroom operations, were $30.3 million in the first quarter, up 17.3% compared to the same period a year ago. This increase was primarily the result of increased North American project related revenues as well as strong performances from the segment's European operations and cleanroom business. As a result of the revenue growth, income from operations for this segment increased to $6.6 million in the first quarter from $4.0 million a year earlier.

Earnings comparisons for the quarter were helped by a decrease in net interest expense of $1.7 million from the first quarter of fiscal 2011. The decrease was due to the expiration of an interest rate swap and the payment of $75.0 million in private placement notes that came due in June 2011. Conversely, the Company recognized foreign exchange losses of $0.6 million in the quarter versus gains of $0.2 million for the same quarter a year ago. In addition, the effective income tax rate for the quarter was 38.3% compared to 37.0% in the first quarter of fiscal 2011. The year ago first quarter tax rate benefited from the reversal of tax contingency reserves related to the resolution of certain state tax audits.

UniFirst continues to maintain a solid balance sheet and overall financial position. Cash and cash equivalents on hand at the end of the quarter was $54.1 million. Cash flows from operations during the quarter increased 12.8% compared to the same quarter a year ago. In addition, the percentage of debt to total capital declined to 12.0%.

Outlook

Mr. Croatti continued, "Although unemployment levels remain high, we are starting to see some improvement in the wearer levels of our existing customer base. Based on this improvement, as well as the strength of our first quarter, we are raising our full year fiscal 2012 guidance. We now project revenues to be between $1.220 billion and $1.235 billion and diluted earnings per share to be between $3.85 and $4.05."

Conference Call Information

UniFirst will hold a conference call today at 10:00 a.m. (ET) to discuss its quarterly financial results, business highlights and outlook. A simultaneous live webcast of the call will be available over the Internet and can be accessed at www.UniFirst.com.

About UniFirst Corporation

UniFirst Corporation is one of the largest providers of workplace uniforms, protective clothing, and facility services products in North America. The Company employs approximately 11,000 Team Partners who serve more than 240,000 customer locations in 45 U.S. states, Canada, and Europe from over 200 customer service, distribution, and manufacturing facilities. UniFirst is a publicly held company traded on the New York Stock Exchange under the symbol UNF and is a component of the Standard & Poor's 600 Small Cap Index.

Forward Looking Statements

This public announcement may contain forward looking statements that reflect the Company's current views with respect to future events and financial performance. Forward looking statements contained in this public announcement are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995 and are highly dependent upon a variety of important factors that could cause actual results to differ materially from those reflected in such forward looking statements. Such factors include, but are not limited to, uncertainties regarding the Company's ability to consummate and successfully integrate acquired businesses, uncertainties regarding any existing or newly-discovered expenses and liabilities related to environmental compliance and remediation, the Company's ability to compete successfully without any significant degradation in its margin rates, seasonal fluctuations in business levels, our ability to preserve positive labor relationships and avoid becoming the target of corporate labor unionization campaigns that could disrupt our business, the effect of currency fluctuations on our results of operations and financial condition, our dependence on third parties to supply us with raw materials, any loss of key management or other personnel, increased costs as a result of any future changes in federal or state laws, rules and regulations or governmental interpretation of such laws, rules and regulations, uncertainties regarding the price levels of natural gas, electricity, fuel and labor, the impact of adverse economic conditions and the current tight credit markets on our customers and such customers' workforce, the level and duration of workforce reductions by our customers, the continuing increase in domestic healthcare costs, demand and prices for our products and services, rampant criminal activity and instability in Mexico where our principal garment manufacturing plants are located, additional professional and internal costs necessary for compliance with recent and proposed future changes in Securities and Exchange Commission, New York Stock Exchange and accounting rules, strikes and unemployment levels, the Company's efforts to evaluate and potentially reduce internal costs, economic and other developments associated with the war on terrorism and its impact on the economy, general economic conditions and other factors described under "Item 1A. Risk Factors" in the Company's Annual Report on Form 10-K for the year ended August 27, 2011 and in other filings with the Securities and Exchange Commission. When used in this public announcement, the words "anticipate," "optimistic," "believe," "estimate," "expect," "intend," and similar expressions as they relate to the Company are included to identify such forward looking statements. The Company undertakes no obligation to update any forward looking statements to reflect events or circumstances arising after the date on which such statements are made.

 

UniFirst Corporation and Subsidiaries

Consolidated Statements of Income

 
Thirteen weeks ended
November 26,   November 27,
(In thousands, except per share data) 2011 (2) 2010 (2)
Revenues $ 313,025 $ 273,090
 
Operating expenses:
Cost of revenues (1) 195,139 163,235
Selling and administrative expenses (1) 59,124 55,183
Depreciation and amortization 16,408 15,502
Total operating expenses 270,671 233,920
 
Income from operations 42,354 39,170
 
Other expense (income):
Interest expense 573 2,203
Interest income (631 ) (582 )
Exchange rate loss (gain) 627 (172 )
569 1,449
 
Income before income taxes 41,785 37,721
Provision for income taxes 15,983 13,957
 
Net income $ 25,802 $ 23,764
 
Income per share - Basic
Common Stock $ 1.37 $ 1.26
Class B Common Stock $ 1.09 $ 1.01
 
Income per share - Diluted
Common Stock $ 1.30 $ 1.20
 
Income allocated to - Basic
Common Stock $ 20,258 $ 18,604
Class B Common Stock $ 5,068 $ 4,704
 
Income allocated to - Diluted
Common Stock $ 25,350 $ 23,330
 
Weighted average number of shares outstanding - Basic
Common Stock 14,838 14,753
Class B Common Stock 4,641 4,663
 
Weighted average number of shares outstanding - Diluted
Common Stock 19,557 19,487

(1) Exclusive of depreciation on the Company's property, plant and equipment and amortization on its intangible assets

(2) Unaudited

 

UniFirst Corporation and Subsidiaries

Condensed Consolidated Balance Sheets

     
(In thousands)

November 26,
2011 (1)

August 27,
2011

Assets
Current assets:
Cash and cash equivalents $ 54,123 $ 48,812
Receivables, net 143,176 128,377
Inventories 73,782 76,460
Rental merchandise in service 133,281 126,536
Prepaid and deferred income taxes 7,369 11,358
Prepaid expenses 6,769 3,647
 
Total current assets 418,500 395,190
 
Property, plant and equipment:
Land, buildings and leasehold improvements 345,020 346,738
Machinery and equipment 398,120 393,530
Motor vehicles 132,176 129,762
 
875,316 870,030
Less - accumulated depreciation 483,114 474,963
392,202 395,067
 
Goodwill 287,910 288,249
Customer contracts and other intangible assets, net 58,141 60,905
Other assets 2,247 2,109
 
$ 1,159,000 $ 1,141,520
 
Liabilities and shareholders' equity
Current liabilities:
Current maturities of long-term debt $ 11,470 $ 20,133
Accounts payable 59,230 56,064
Accrued liabilities 75,508 76,630
Accrued income taxes 2,523 -
 
Total current liabilities 148,731 152,827
 
Long-term liabilities:
Long-term debt, net of current maturities 100,180 100,163
Accrued liabilities 41,530 39,698
Accrued and deferred income taxes 51,005 50,890
 
Total long-term liabilities 192,715 190,751
 
Shareholders' equity:
Common Stock 1,500 1,499
Class B Common Stock 488 488
Capital surplus 35,504 33,588
Retained earnings 777,623 752,530
Accumulated other comprehensive income 2,439 9,837
 
Total shareholders' equity 817,554 797,942
 
$ 1,159,000 $ 1,141,520

(1) Unaudited

 

UniFirst Corporation and Subsidiaries

Detail of Operating Results

   

Revenues

 
Thirteen weeks ended
November 26,   November 27, Dollar Percent
(In thousands, except percentages) 2011 (1) 2010 (1) Change Change
 
Core Laundry Operations $ 272,273 $ 238,691 $ 33,582 14.1 %
Specialty Garments 30,268 25,811 4,457 17.3
First Aid 10,484 8,588 1,896 22.1
Consolidated total $ 313,025 $ 273,090 $ 39,935 14.6 %

Income from Operations

   
Thirteen weeks ended
November 26,   November 27, Dollar Percent
(In thousands, except percentages) 2011 (1) 2010 (1) Change Change
 
Core Laundry Operations $ 34,982 $ 34,414 $ 568 1.7 %
Specialty Garments 6,566 4,029 2,537 63.0
First Aid 806 727 79 10.8
Consolidated total $ 42,354 $ 39,170 $ 3,184 8.1 %

(1) Unaudited

 

UniFirst Corporation and Subsidiaries

Consolidated Statements of Cash Flows

 
Thirteen weeks ended

(In thousands)

November 26,

2011 (1)

November 27,

2010 (1)

Cash flows from operating activities:  
Net income $ 25,802 $ 23,764
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation 13,727 13,125
Amortization of intangible assets 2,681 2,377
Amortization of deferred financing costs 59 67
Share-based compensation 1,668 1,684
Accretion on environmental contingencies 158 170
Accretion on asset retirement obligations 158 147
Deferred income taxes 51 5,433
Changes in assets and liabilities, net of acquisitions:
Receivables (16,100 ) (17,274 )
Inventories 2,332 (4,759 )
Rental merchandise in service (7,505 ) (5,133 )
Prepaid expenses (3,137 ) (2,443 )
Accounts payable 3,529 2,677
Accrued liabilities 623 2,077
Prepaid and accrued income taxes 6,608 5,254
Net cash provided by operating activities 30,654 27,166
 
Cash flows from investing activities:
Acquisition of businesses - (2,220 )
Capital expenditures (13,966 ) (12,250 )
Other (118 ) (776 )
Net cash used in investing activities (14,084 ) (15,246 )
 
Cash flows from financing activities:
Proceeds from long-term obligations 7,000 -
Payments on long-term obligations (15,371 ) (496 )
Proceeds from exercise of Common Stock options 248 153
Payment of cash dividends (709 ) (707 )
Net cash used in financing activities (8,832 ) (1,050 )
 
Effect of exchange rate changes (2,427 ) 1,137
 
Net increase in cash and cash equivalents 5,311 12,007
Cash and cash equivalents at beginning of period 48,812 121,258
 
Cash and cash equivalents at end of period $ 54,123 $ 133,265

(1) Unaudited

UniFirst Corporation
Steven S. Sintros, 978- 658-8888
Vice President & CFO
ssintros@unifirst.com